Finovate and the Context of Fintech

I’ve been thinking about the genesis of Finovate in 2007 and just how much this conference has influenced the financial services industry. Before Finovate, no single conference provided a venue to demonstrate the latest technology impacting our customers - whether that meant a solution that a bank or credit union could deploy - or whether that meant some form of disruption that we had to be concerned about.

Before Finovate, no other conference provided a venue to connect technologists, user experience professionals, VCs and other fintech investors, and financial institutions. This is why I’ve never missed a west coast Finovate, and yesterday and this morning’s sessions didn’t disappoint. One day I’ll go to all four Finovate’s in a calendar year - New York, San Francisco, Singapore, London. Add it to your bucket list. Hats off to Finovate founders Eric Mattson, Jim Breune, and their great team for another great event.

^ED Yes, agreed. The Finovate series is a great event to fuel innovation in this sector. I still think Eric and team need to come up with a Finovate theme song to kick off each show .

Consider the impact of Finovate in context of the influx of interest, company formation, and investment in fintech-related activity. Finovate alumni companies garnered over $600 million in investment in the first quarter of 2014 alone (Finovate.com) Jim Bruene reported that over $60 million of that funding came on one single day - March 25, 2014 (Netbanker ).

^ED One of the best examples of this is the evolution and recent explosive growth of LearnVest. I remember talking with Alexa Von Toble a few years back when the product focused on money management tools for women. Now the product has expanded its demographic reach and includes guidance from certified financial planners. Most recently they announced a healthy $28M round. NICE!!! Look for continued success out of this team.

Outside of Finovate presenting companies, there are now 1,084 payment startups listed on AngelList, encompassing 23,113 investors for an average investment of $3.9 million per company (to be fair, there are a number of well-funded firms on that list, such as Square and Stripe - but these are firms focused on dozens of different areas of payments, some potentially incredibly disruptive).

Since the beginning of 2013, venture investors committed over $800 million in new funding to develop businesses providing new investment, lending, mortgage and real estate, and wealth management services in the U.S. These startups have had their best quarter so far in 2014, when 13 companies raised $238.2 million in later stage funding — with at least $162 million committed in March alone.

"Financial services industries are gigantic and are the least suited to making transformational changes in their own businesses,"

Globally, fintech investment has more than tripled over the past three year, according to the study — rising from $928 million in 2008 to $2.97 billion in 2013 – with fintech investment increasing at more than four times the rate of overall VC investment. (Techcrunch)

Overall, that’s some serious investment activity chasing after the revenue stream within financial services, payments, the servicing of credit mechanisms, and the management of wealth. Why aren't more brands concerned? Why aren’t more financial brands present at Finovate? While there are many more FI Finovate attendees than in year’s past, it’s important to connect directly with people and ideas presented at Finovate.

^ED I think this event is gaining momentum. I heard from the Finovate team that this event is the most attended yet. Awareness across the media channels is growing and word of mouth is fueling interest too. I think we will see more and more financial brands filtering through the networking sessions. As we know, most innovations happen OUTSIDE of the bank. Banks need to get here to stay ahead.

These firms and this related investment are not only potential competition, they are potential partners. Financial institutions and fintech players of all sizes are moving to forming alliances and forming new disruptive forms of customer value.

That’s why I’m at Finovate. And that’s why I'm glad to see you here too.